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Republicans To Wheeler: Don't Limit Auction Bidders

Every Republican member of the House Communications Subcommittee has asked FCC chairman Tom Wheeler to rethink his plans to put some limits on the broadcast incentive auctions.

Wheeler has circulated a draft item that, under certain circumstances, would set aside some low-band spectrum (30 MHz) for companies that don't have as much as, say, Verizon or AT&T. It would also change its local-market spectrum screen so that low-band spectrum holdings would also trigger deeper FCC scrutiny of deals involving spectrum concentration.

In a letter to the FCC Friday, the House members called that an attempt to "manipulate the market." They said that "artificial set-asides" and other restrictions "alter the playing field and distort the outcome."

The legislators predict that the FCC will only be clearing about 60 MHz of broadcast spectrum—the FCC was initially targeting 120 MHZ but has long since backed off that figure. That means half of the spectrum could be set aside. The Republicans say that sounds like a cartel controlling prices by artificially controlling supply.

"We urge the Commission to reconsider any plans that would further cloud an already complex auction and threaten the outcome for providers, consumers and the public safety community."

The FCC is predicting that by the time the broadcast incentive auction is held in mid-2015, FirstNet, the interoperable public safety network will have been mostly, if not completely, paid for by the two earlier spectrum auctions, the H Block earlier this year and the AWS-3 auction scheduled for the fall.

Wheeler plans a May 15 vote on the incentive auction and spectrum screen proposals.

He has insisted that all companies will be able to bid in the auction, but that trying to encourage broader distribution of low-band spectrum holdings given its wireless broadband-friendly propagation characteristic is in the public interest.